GDP growth remains strong

The New Zealand economy grew 0.9 percent in the September 2015 quarter, following an increase of 0.3 percent in June, Statistics New Zealand said today. The September quarter increase was driven by growth in the service industries and manufacturing.

“The increase this quarter follows lower growth earlier in the year, which has brought the annual growth down to 2.9 percent,” national accounts manager Gary Dunnet said.

2.9% annual growth is very decent.

And the main increase has been in manufacturing. Even since Labour, Greens and NZ First declared manufacturing is in crisis three years ago it has grown 6.7% in real terms.

If you want to look around and find some inciteful comment on all this you will see that oru GDP is languishing and is only being supported by the increase in our population. (that too is a normal situation for a National Govt. Dig themselves out by increasing population and never mind from where.)

GDP up 0.9% in Sept qtr and up 2.3% from year ago as services, cow culling surge; Real Gross National Disposable Income per capita down 0.4% for year after 1.8% rise in population and weaker terms of trade.

Statistics New Zealand’s measure of Real Gross National Disposable Income (GNI) per capita fell 0.2% in the September quarter and was down 0.4% in the year to September after the population rose 1.8% to 4.577 million.

The jump in manufacturing was driven partly by extra culling of cows by loss-making dairy farmers and services sector growth of 0.9% for the quarter was helped by a fast-growing tourism sector. Cconsumption spending by non-residents grew 31% in the September quarter from a year ago to a record high NZ$2.6 billion.

The 0.9% growth in GDP was slightly stronger than the 0.8% consensus forecast from economists, although the 2.3% annual rise was in line with expectations after the June quarter growth was revised down to 0.3% from 0.4%. It was the slowest annual growth rate since the December quarter of 2013, but the quarterly growth was higher than the Treasury and Reserve Bank forecasts for a 0.6% rise.

The implicit price deflator, which is another way to measure inflationary pressures, fell 0.6% to 1109 in the quarter and was barely up from the 1105 reported for the September quarter of 2015 (sic), reinforcing the disinflationary pressures in the economy that the Reserve Bank faces.

I don’t know about the RBNZ facing anything, but what is certain, the four local Australian banks paid dividends upward of $3.7 billion for the 2015 financial year compared to $2.561 billion for the 2014 financial year, which was up from $920 million the previous year, according to Gareth Vaughan.

The resident domestic bank capital cushion may be deflating, but not the ~44.77% increase in wealth transfer from NZ citizens back to Australia.

It must be noted that nominal GDPE rose 2.7753% for the year ending September 2015 compared to 2.8298% for the year ending June 20

Have you seen the latest comments from English about the RBNZ’s performance?
Just wondering what your thoughts were on this, given your past posts about the relationship between the Treasury and the RBNZ.